6 promises from MarketWatch’s new columnist

Jonathan Clements issues rules of the road for his new column

By

JonathanClements

On April 6, 2008, I wrote my final column for The Wall Street Journal Sunday. Or so I thought. After working on Wall Street for six years, I’m back. Definitely older and crankier. Maybe wiser. But you can be the judge of that.

If you recall, I’m the ink-stained wretch who spent 18 years at the Journal touting the virtues of saving early and often, keeping investment costs and taxes to a minimum, buying index funds and never trying to guess the market’s direction. But after 1,009 columns, I left for Citigroup, where I was director of financial education for the U.S. wealth-management business.

Six years of corporate life proved to be more than enough, so I’m returning to writing full time. In addition to this weekly column, I have a new book in the works, which will be out in early 2015. What to expect in the weeks and months ahead? Here are the rules of the road.

No forecasts. Nobody can consistently predict the direction of the financial markets, especially over the short term, so I won’t be wasting time on such a useless undertaking.

I will, however, pay attention to valuations. Investors should view themselves not as pursuers of performance but as managers of risk. Lofty stock-market price-earnings ratios and miserably low bond yields are big risks. I’ll be discussing both over the next few months.

No news. Personal-finance writers are always looking for a news hook to justify their latest ramblings, and I’ll grab one if it’s readily available. But don’t be fooled: A lot of my columns could run six months earlier or later and be equally relevant. We manage money best when we view it as a long-term endeavor, and that’s my focus.

In this column, expect to read a fair amount about perennially important topics such as how much you ought to save, how to generate retirement income and how to design a portfolio. Yes, the answers vary a little as the markets bounce up and down. But they don’t change that much.

No jargon. When you strip away all the nonsense, managing money is simple. You set goals, save regularly, diversify broadly, limit investment costs, manage taxes, buy just enough insurance, purchase the right size home, hold down debt and give some thought to your heirs.

But for most financial firms, simplicity isn’t a viable business model. They need investors to be confused and cowed, so they seek high-price help and buy products with bloated fees.

If I’m doing my job, nothing in this column should confuse you. It isn’t because I’m dumbing down the subject. It’s because I’m taking Wall Street mumbo-jumbo and putting it in plain English.

No politics. I don’t care whether you’re a right-winger who thinks Social Security is a socialist Ponzi scheme or a left-winger who thinks the stock market is a casino rigged in favor of the big boys.

The fact is, Social Security and stocks are both key financial tools. The goal of this column is to help you make the most of them, not engage in public policy debates. I, too, have strong political views. But political posturing has no place in this column.

No hate mail. Six years ago, I used to get a heap of emails every week, some of them apparently sent by people who like to attack columnists with the same foul-mouthed fury usually reserved for someone who just murdered your entire family.

From what I gather, civility hasn’t exactly improved over the past six years. I’m happy to receive messages with reasoned disagreement at SundayJournal@aol.com. But if you find yourself hyperventilating at the computer, I would encourage you to put down the keyboard and back slowly away.

Getting to yes. Many personal-finance writers, I believe, spend too much time talking about the things people shouldn’t do. If you’ve spent any time hanging around reporters, this isn’t a big surprise: They are a snarky, skeptical bunch, which is why they’re so much fun to work with.

But it also means they find much to disdain and little to like. Readers, however, are looking for something different. They want to know what to do with their money, rather than what not to do.

While you’ll find me issuing warnings about this and that, you should also come away from each column with one or two ideas about how you might improve your financial life.

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